Assuming your advice clients are engaging for the long-term rather than short-term (and therefore you aim to earn on-going fees every year, not just the first year), then a re-think on the ‘depth’ of engagement between your firm and its advice clients might be worthwhile.
Deep ‘engagements’ with advice clients act like deep house ‘foundations’ – they tend to withstand the inevitable challenges.
I believe our clients are going to expect greater ‘depth’ to their adviser relationships as the internet changes their buying habits, as your competitors make them more aware of their financial choices and as they seek greater control over their financial lives whilst trying to do all this in their time-poor lives.
In fact, if the main reason why most of your advice clients are engaging your firm’s on-going services is built on shallow foundations such as offering them “greater sense of security”, or “less financial stress”, or “more financial options”, then your on-going revenue streams are in trouble, big trouble.
Clients seeking strong advice relationships with their financial advisers need ‘deeper’ motivations to trust you, pay you and continue to work with you than these ‘base’ level motivations. It’s fundamental to be able to recognise the ‘shallow’ and the ‘deep’ reasons for engaging, paying and understanding the value of any client-adviser relationship.
Simplistically, a response like “I just want a secure retirement” is what I refer to in our training as a ‘Level 1’ motivation.
Too many advisers fail to probe beyond this response for a number of wrong reasons and assumptions, not the least of which is the adviser has heard it so often before and they incorrectly assume they know what ‘secure retirement’ means for their client.
That’s like assuming we can predict the weather, politics or the further influence of technology on our lives – we can’t and an adviser can’t afford to. In fact, ‘Level 1’ motivations are not reasons to engage or stay with an advisory firm, but are just the opposite – they are the reasons why they’ll defect when someone else’s marketing message rings their bells, or their workmates suggest the latest property opportunity or self-managed superannuation fund, or they lose their jobs and the first costs to go are yours.
Through our training we have formed a different view about the client’s “level 1” motivations.
To be the adviser they turn to, not away from, advisers have to ‘probe’ deeper than these Level 1 responses to, you guessed it, Level 2 responses.
Deep in their Level 2 aspirations are the core reasons why they continue to engage and continue to engage when ‘things change’. Level 2 aspirations centre around your client’s as yet un-achieved aspirations and desires in areas such as family, homes, business, travel, community, hobbies, charities and gifting.
The ‘gold’ within each Level 2 aspiration is what we term their ‘signature’ aspirations – some aspirational outcome idiosyncratic and unique just to them (e.g. not just ‘I’d like to take an overseas trip’, but “I’d like to trek part of the St James pilgrimage”).
It takes skill and often a mindset shift to learn how to extract these deeper aspirations from clients especially when they themselves have not deeply considered some of their own aspirations in their busy lives.
In my work training financial advises it never ceases to amaze me how much effort and compliance work advisers naturally put in to understanding their client’s financial lives and how little effort, time and rigour they put into understanding their client’s deep financial aspirations.
These are vital times to put the rigour into consistently discovering our clients Level 2 signatures outcomes which in themselves represent why our clients will pay our fees and where they seek the value that we.
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About Jim Stackpool
For nearly 30 years Jim has influenced, coached, and consulted to advisory firms across Australia. As founder of Certainty Advice Group, he leads a like-minded team of professional advisory firms seeking to create greater certainty for their clients. As an author, blogger, columnist, and keynote speaker, Jim is regularly called upon for his professional insights into the advice industry. His latest book Seeking Certainty is available now.